Annual Report 2009
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Annual Incentive

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Each year, a variable cash incentive (Annual Incentive) can be earned, based on the achievement of specific and challenging targets. The Annual Incentive criteria are for 80% the financial indicators of the Company (net income, comparable sales growth and free cash flow). In 2009 the focus was on comparable sales growth and free cash flow. The 20% team targets comprise the major elements of the management agenda, including sustainability elements.

The on-target Annual Incentive percentage is set at 60% of the base salary for members of the Board of Management and 80% of the base salary for the President/CEO, and the maximum Annual Incentive achievable is 120% of the annual base salary for members of the Board of Management and for the President/CEO it is 160% of the annual base salary.

The Annual Incentive pay-out in any year relates to the achievements of the preceding financial year in relation to agreed targets. As a result, Annual Incentives paid in 2010 relate to the salary levels and the performance in the year 2009. The amounts in the table below will be paid to the members of the Board of Management in April 2010.

Pay-out in 20101)
in euros
 
realized annual incentive
as a % of base salary (2009)
 
 
 
G.J. Kleisterlee
962,720
87.5%
P-J. Sivignon
459,480
65.6%
G.H.A. Dutiné
410,250
65.6%
R.S. Provoost
416,814
65.6%
A. Ragnetti
416,814
65.6%
S.H Rusckowski
416,814
65.6%
1) Reference date for board membership is December 31, 2009
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  • Comparable sales
    excludes the effect of currency movements and acquisitions and divestments (changes in consolidation). Philips believes that comparable sales information enhances understanding of sales performance.
  • Free cash flow
    net cash flow from operating activities minus net capital expenditures.
This is an interactive electronic version of the Philips Annual Report 2009 and also contains certain information in summarized form. The contents of this version are qualified in their entirety by reference to the printed version of the Philips Annual Report 2009. The printed version is available as a PDF file on this website. Information about: forward-looking statements, third-party market share data, fair value information, IFRS basis of presentation, use of non-GAAP information, statutory financial statements and management report, reclassifications and analysis of 2008 compared to 2007.
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